Changing trends in holiday rentals

As increased numbers of holiday rental hosts feel the momentum pick up, so the spirits of those involved are soaring at the prospect of a return to a semblance of normality. There are reports of increasing enquiries for year-end accommodation and hosts are anticipating a reasonable influx of South African visitors.

With few international travellers expected, heightened competition is developing in this market and many hosts are doing their utmost to spruce up their accommodation offerings in order to compete in what, this year, will be an over-flooded market. This leaves holidaymakers with a wide choice, especially as there are no clear guidelines on nightly rates.

Research on Airbnbs in the Overstrand shows that, for example, quality accommodation for a six- sleeper can range from R1 800 per night to R3 500 per night. Whilst normally one would be able to ascribe this discrepancy to the difference in quality of the amenities, appliances, décor and finishes, this year very similar properties offering the same amenities are on the market at vastly different rates.

The nightly rates for 10-sleeper properties range from around R3 500 to R12 500, with a few notable exceptions – for which most South Africans would have little appetite – at up to R24 000 per night.

A new trend, which is very much a sign of the times, is for people to list their properties directly on Facebook, Gumtree, or any other website that is not a formal booking platform, like Airbnb, and the rest. Whilst this is an alternative means of sourcing guests, there are some red flags for travellers to consider. The main reason people avoid portals like Airbnb is due to the fees they charge both guests and hosts, but with that comes a level of security and protection otherwise not guaranteed.

Most of us are aware of the recent debacle in Camps Bay, Cape Town, where a group known as ‘activists’ booked an Airbnb for a weekend under false pretences and then stayed on as squatters to highlight housing and land issues. From a legal perspective, this was undertaken in a deceitful manner and with criminal intent, as stated by the owner’s attorneys, and the end result was that the case went to court and the culprits were forced to vacate or face eviction.

The point here is that anyone offering holiday accommodation directly to guests has no protection whatsoever should a similar situation occur. Unless the guests are known personally to the owners, or family or friends who can vouch for them, you are opening yourself up to all kinds of risks if something goes wrong. One of the key advantages of listing on a recognised platform is that there are strict vetting procedures for hosts and guests, and various forms of protection are in place.

If letting directly, owners need to introduce some system of guest validation and verification, and should consider implementing strict checks to protect themselves and their properties. They should have an appropriate rental agreement and consider additional checks on prospective guests’ financial liquidity, or possibly require larger deposits. Having no rental agreement in place is highly risky and could result in untold legal complications, should things go wrong.

In the Camps Bay incident, the owner could immediately call on back-up and assistance from Airbnb in support of their stance against the guests. Many Airbnb hosts were panicked by these unexpected events and Airbnb responded appropriately with the following message:

“We want to reassure you that protecting Airbnb’s host community is of key importance to us. We are keeping an open line of communication with the host and are reviewing all reasonable options, as overstays go against our terms of service.

“At Airbnb we are continuously working on ways to make our community as secure as possible for everyone. That’s why, before booking, guests are verified by asking for their government ID, legal name and address, and Airbnb only charges for reservations at the point of booking.

“In addition to these deterrents Airbnb also provides hosts with the security of a Host Guarantee which provides protection for up to $1 million for guest damages to properties.”

Whilst many hosts are trying to minimise their expenses and achieve the highest possible income, renting directly to guests can bring about huge challenges and it’s that protection that one pays for when listing on a recognised website. That said, there is no doubt that the ‘new normal’ will bring a change to many of the traditional ways of going about holiday lets and hopefully the result will be a positive one that benefits all parties.